Bank of America Faces Discrimination Suit

A group of former and current investment advisors at Bank of America claim that over the last decade they've been routed away from high-income territories because of their race. The group is now suing the bank under the 1964 Civil Rights Act. Darnley Stewart, attorney for the plaintiffs, talks to Tony Cox about the case, as well as the state of equal employment in the banking industry.

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TONY COX, host:

Which brings us to this. Earlier this month, five African-American current and former employees of Bank of America filed a class-action lawsuit against the company. The five plaintiffs, who have worked or are still working for the company, say that since April 2003 they have been subjected to racial discrimination. They say that among other things, they were denied lucrative contracts and were pigeonholed in largely non-white, lower-income neighborhoods.

The company has defended its position and told NEWS & NOTES in a statement that, quote, "Bank of America has a strong track record of hiring and developing associates. We have been recognized for our success in creating and supporting a diverse and inclusive workplace. The discriminatory conduct alleged in the complaint would violate Bank of America's policies and values, which prohibit discrimination. We intend to vigorously defend against the claims made in this lawsuit."

So, right now, we are joined by Darnley Stewart, who is co-lead counsel in the case, to help us break this all down. Ms. Stewart, nice to have you.

Ms. DARNLEY STEWART (Attorney): A pleasure.

COX: I have a copy of the complaint in front of me, which - I'm not a lawyer, by the way, although I have read the complaint. I just wanted to make sure that we're clear about that.

Ms. STEWART: I'll try not to use too much jargon, then.

(Soundbite of laughter)

COX: The type of discrimination that you talk about in the complaint - you used terms like second-generation, steering, parking - explain what they are and how they fit into the context of the complaint, please.

Ms. STEWART: Sure, Tony. Second-generation discrimination - actually the idea of second-generation discrimination, I think, arose in the area of education. But in terms of workplace discrimination what that has come to mean is the use of certain patterns or corporate structures that have the effect of excluding or prejudicing non-dominant ethnicities or racial groups. And so whereas we may no longer be seeing what we would call first-generation discrimination, that would a hanging a noose in the plant or the use of the racial epithets in the workplace, we're seeing a more subtle form of discrimination that's having equally pernicious effect, that's really prejudicing racial groups.

COX: So the steering and the parking, these are examples of the kind of discrimination you allege?

Ms. STEWART: Exactly.

COX: This is a class-action complaint, meaning that you're suing on behalf of similarly situated Bank of America employees elsewhere, though none is specifically named in the complaint. What are the rules for determining the class? And how have you determined how large the class of possible plaintiffs actually is?

Ms. STEWART: Well, the rules are the federal rules of civil procedure, which are - its rule 23, which is the rule that governs class actions. How we would go about determining the scope of the class is when we get discovery from the defendant - which we would right at the beginning of the case, and that has not happened yet - we'll be able to determine how many potentially affected class members are out there.

COX: In the lawsuit you talk about the fact that these five plaintiffs claim that they were denied the opportunity to make money the same way and in the same fashion that their white counterparts did. Speak to the issue, please, of what protections or guarantees you think an employee is entitled to with regard to making money in the workplace, because, by its very nature, financial services is a very competitive field.

Ms. STEWART: Of course. It's pretty simple to me, Tony. All these folks wanted after years of education - and some of them had MBAs - years of working in the financial services industry, and they all had worked successfully for years for other companies and after they left - those who left, after they left Bank of America - all they wanted was equal opportunity. All they wanted was the opportunity to work in high net worth neighborhoods and be able to market their services to high net worth clients.

COX: What relief do you seek, specifically?

Ms. STEWART: Well, obviously a change in the company practices first and foremost. And they'd be entitled to the difference between what they've received in terms of commissions and what they would have received had they not been subject to this discrimination.

COX: We mentioned at the top of the show, Ms. Stewart, that the United States Supreme Court just today issued a ruling which limits an employee's ability to sue for pay discrimination that, in the court's words, arise from employment decisions that are long-past. What impact might that ruling have on your case?

Ms. STEWART: All of these people worked within - they have all filed their case within the applicable statute of limitations. Really, the effect - I think that case, by the way, is completely wrongly decided - but they're not going to have this problem, and our case only goes back to 2003. I think the Supreme Court case went back - the woman was seeking relief for things that happened a long time ago.

COX: Right, 19 years back, as a matter of fact.

Ms. STEWART: Right.

COX: There's one woman listed as a plaintiff in this complaint. Are you alleging gender bias in addition to racial bias?

Ms. STEWART: No, this is a race discrimination case.

COX: Do the requirements - just for our own edification - do the requirements differ for proof in gender versus race?

Ms. STEWART: No, absolutely the same.

COX: Absolutely the same?

Ms. STEWART: Yes.

COX: Here's another question. Looking at the longer-term impact of the work discrimination cases like this one, once a case has been decided, and let's say it was decided in the favor of the plaintiffs just for argument's sake, do courts have the authority to order a company to change its organizational policy? And does that ever happen?

Ms. STEWART: Absolutely. And if it doesn't happen through the court system, there have been a number of cases where there have been settlements where diversity task forces were put together and very real changes were made to company practices. For instance, my firm was involved in the Texaco case, and that was probably the first case where really serious, programmatic changes to a company were brought about by a class-action case.

COX: Let's go back to the basics of this particular lawsuit, and perhaps it would be beneficial for the audience to hear from you. Specifically, what did Bank of America do to these individuals that they consider discriminatory? Can you give us an example of something that they actually did or did not do?

Ms. STEWART: Well, there are a number of disparities that our clients faced vis-a-vis their Caucasian counterparts, including lack of resources, one of the client was entitled to a promotion and didn't get it. But basically the one thing that all five - and it's important to note that these people worked in different markets and not on the same office. We have clients who worked in West Palm Beach. We have clients who worked in Fort Lauderdale, St. Louis and Atlanta. All had a very similar experience, essentially the same experience, which is when they would be put with a Caucasian partner, whether it a premier bank or a financial adviser who had a great deal of business in certain neighborhoods, high net worth neighborhoods, they would only be, and I think the complaint uses the word parked.

They'd just be there for - you know, put with that partner, with that banker for just a month or two and then immediately moved over to be partnered with an African-American banker or financial adviser. And then together, this partnership would only be assigned neighborhoods that were high minority and low-net worth neighborhoods.

And when they would ask, can we please be assigned to different accounts in other neighborhoods, they were told it's our belief that our clients in these neighborhoods are more comfortable with someone of their own race.

COX: When does an action of a company go from being simply unfair to being illegal with regard to how it treats its employees?

Ms. STEWART: Well, when it violates the equal employment laws of this country, and there's a long history of cases in federal court that are somewhat similar to the situation here, where a company says we think the client or customer is more comfortable with someone of their own gender or someone of their own race. And the best example of that is there were series of cases in the 1980s involving female stewardesses, and there was actually proof that male passengers - and at that time, most of the airline passengers were male - preferred to have female stewardesses waiting on them instead of male stewards. And the courts came down very firmly against that kind of preference.

COX: Now, we are just in the beginning stages of this. We meaning you, actually.

Ms. STEWART: Yes.

COX: What is the next phase? We have about a minute left.

Ms. STEWART: The next stage, Tony, is to get into what we call discovery. And you said you weren't a lawyer, so I'll just explain. That's exchanging documents, and taking depositions, and learning about the defenses that the company has to this lawsuit.

COX: Darnley Stewart speaking to us from New York City. Thank you very much. We appreciate the information.

Ms. STEWART: My pleasure.

COX: And again, we contacted Bank of America, who declined to come on the air but gave us a statement which says: The discriminatory conduct alleged in the complaint would violate Bank of America's policies and values, which prohibit discrimination. We intend, they said, to vigorously defend against the claims that were made in this lawsuit.

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